Author Topic: KMI - Kinder Morgan  (Read 145121 times)

Spekulatius

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Re: KMI - Kinder Morgan
« Reply #430 on: May 29, 2018, 10:09:11 AM »
I canít understand the reaction of KML.TO to this news either and hence bought some KML stock. Looks like a fair deal and win- win to me.
To be a realist, one has to believe in miracles.


Spekulatius

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Re: KMI - Kinder Morgan
« Reply #431 on: May 29, 2018, 04:44:38 PM »
KML looks quite interesting. If KM CA makes ~200M in EBITDA it means that KML share would be 39% of this or 60M or roughly 60c/share. Now KML will receive 12.5 CAD in cash proceeds for a 16.2CAD share price.

The question is what is KMI going to do with KML. The current structure makes no sense and is also tax inefficient. KMI could either buy thr minority KML holders out, or they could sell the bulk all or of the remainder of the company to KML shareholders. Current equity of KMI in their Canadian business is 2.1B CAD, so KML with 1.25B CAD and adding the remainder in debt could buy them out (depending on premium to book).

This would make sense to KMI because KMI itself is cheap (they could buy back stock with the proceeds or deleversge) and holding KML as a Canadian C-Corp isnít tax efficient for KMI.
To be a realist, one has to believe in miracles.

wisowis

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Re: KMI - Kinder Morgan
« Reply #432 on: July 19, 2018, 05:45:59 PM »
Q2 Results for KML: https://ir.kindermorgancanadalimited.com/2018-07-18-Kinder-Morgan-Canada-Limited-Declares-Dividends-and-Announces-Results-for-Second-Quarter-of-2018

- Adjusted EBITDA was $107.8 million, up from $91.5 million in the previous period.
- For the first half of 2018, KML generated net income of $58.1 million, Adjusted EBITDA of $205.8 million, and DCF of $168.8 million.
- KML expects the transaction to close late in the third quarter or early in the fourth quarter of 2018. 
- Eliminates 3% market discount for the DRIP.

JRM

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Re: KMI - Kinder Morgan
« Reply #433 on: July 20, 2018, 04:34:26 AM »
It sounds like KMI management is open to selling KML based on answers given to the analysts during the conference call. 

wisowis

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Re: KMI - Kinder Morgan
« Reply #434 on: September 14, 2018, 05:38:19 PM »

gfp

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Re: KMI - Kinder Morgan
« Reply #435 on: February 06, 2019, 06:49:47 AM »
I haven't followed this one in a while, but I keep noticing Richard Kinder buying shares in the market every day lately -

https://www.sec.gov/cgi-bin/own-disp?action=getissuer&CIK=0001506307

I suppose he could just be reinvesting his dividends

petec

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Re: KMI - Kinder Morgan
« Reply #436 on: February 06, 2019, 08:51:57 AM »
I haven't followed this one in a while, but I keep noticing Richard Kinder buying shares in the market every day lately -

https://www.sec.gov/cgi-bin/own-disp?action=getissuer&CIK=0001506307

I suppose he could just be reinvesting his dividends

Or his $1 salary ;)

JayGatsby

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Re: KMI - Kinder Morgan
« Reply #437 on: February 06, 2019, 10:50:02 AM »
I din't realize that. Thanks for sharing.

This is my biggest position (not that my historical returns warrant following me lol).

Seems like an incredible valuation to me. Double digit FCF yield, moderate debt load now, good capital allocation, solid reinvestment opportunities.

There's some decent articles on seeking alpha about it recently actually. The company's investors primarily seem to value it based on dividend yield. So I think you have a disconnect between the yield and what's actually happening in the financials. They'll increase the dividend to $1.20 a share in about a year, so that should warrant some revaluation if nothing else does.  They got way over their skies with dividends pre recession and burned a lot of their investors. They basically told all their retiree dividend investors they'd continue to increase the (large) dividend and then a month later they slashed it, crushing the valuation and crushing people's retirement accounts.

Spekulatius

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Re: KMI - Kinder Morgan
« Reply #438 on: February 06, 2019, 03:53:58 PM »
I din't realize that. Thanks for sharing.

This is my biggest position (not that my historical returns warrant following me lol).

Seems like an incredible valuation to me. Double digit FCF yield, moderate debt load now, good capital allocation, solid reinvestment opportunities.

There's some decent articles on seeking alpha about it recently actually. The company's investors primarily seem to value it based on dividend yield. So I think you have a disconnect between the yield and what's actually happening in the financials. They'll increase the dividend to $1.20 a share in about a year, so that should warrant some revaluation if nothing else does.  They got way over their skies with dividends pre recession and burned a lot of their investors. They basically told all their retiree dividend investors they'd continue to increase the (large) dividend and then a month later they slashed it, crushing the valuation and crushing people's retirement accounts.

You can still read endless comments to the tune of ď We will never forgive the dividend cutĒ from investors back then in Seeking Alpha. The valuation is still fairly low, even after a ~15% run up from the lows. I do wonder if sooner or later they will dispose of the fairly commodity price sensitive CO2 segment they imo doesnít fit quite in KMI any more. It might be dilutive to DCF/share to do so,  it I think it would help to get KMI valued higher. I am still hanging on all my shares, but have whittled down my WMB and ENB holdings a bit, since they recovered.
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JayGatsby

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Re: KMI - Kinder Morgan
« Reply #439 on: February 11, 2019, 10:56:23 AM »
More purchases by Kinder: https://seekingalpha.com/article/4239804-insider-weekends-chairman-kinder-morgan-steps-insider-purchases

Granted he's basically just reinvesting dividends, but positive nonetheless.